24 Jan

What does a mortgage broker do? – Welcome to the January issue of my monthly newsletter!


Posted by: Stacey Anderson Doran

January 2013
Stacey DoranMortgage Specialist

DLC – The Mortgage Hub

Phone: 604 649 6200 Fax: 604 608 3336 E-mail Website


Dominion Lending Centres has launched a new Visa Card Program! You can now conveniently apply for a Dominion Lending Centres Visa directly through me. There are six different cards available, including: 1) Student; 2) Classic; 3) No-Fee Gold; 4) Low-Rate Gold; 5) Travel Gold; and 6) Platinum. Each Visa card includes a minimum three-day complimentary insurance coverage (even on no-fee cards), low regular rates ranging from 9.9-19.9%, the chance for applicants to win 500 BONUSDOLLARS (1 BONUSDOLLAR = $1 Canadian) over the next three months (several draws in each of January, February & March), and the travel program is a great option thanks to no 14-day advance booking notice or blackout periods. For details or to apply today, give me a call or send me an email.

About DLC Leasing Inc
* DLC Leasing is the leasing division within Dominion Lending Centres Inc.
* Our leasing programs provide up to 100% financing on business-related equipment.
* Leasing options include new equipment leasing; used equipment and vehicle leasing; customized solutions through vendor finance programs; and lease-backs –where the lender buys equipment from a business owner and the owner leases it back.
* Technology, heavy equipment and trailers, furniture and hospitality equipment, and manufacturing and industrial equipment are just a few examples of available leasing options.
* With access to multiple lending sources, Dominion Lending Centres’ Lease Professionals can cater to leasing deals for a variety of credit scenarios ranging from A to C credit quality.
* Because many of our Lease Professionals are also licensed mortgage agents, we can offer standard equipment leases and creatively structured solutions for seasonal, new or growing companies.
* Working with someone who is both a lease and mortgage expert enables you to even use commercial and residential mortgage and property credit line products, alone or in combination with lease financing, to help achieve the best solutions for your equipment acquisition needs.
* Our Lease Professionals can even break up large-dollar transactions into multiple leases across a number of funders to ease and simplify the approval process.


Welcome to the January issue of my monthly newsletter!

What does a Mortgage Broker do?

It is still a mystery to the majority of Canadians and is costing them far too much money. A good Mortgage Broker becomes your advocate when borrowing and can save you over $37,000 over the life of your mortgage including almost $5,000 during the first term alone1.

Studies conducted by Maritz Research & the Bank of Canada show that working with a Mortgage Broker versus the bank saves the average borrower 17.5 basis points on their first mortgage2 and 40 basis points on every subsequent mortgage renewal3.


Saving is all about the best rate right?
That’s the big shiny price tag and when it’s low, we feel like we got a deal and are part of a secret society of clever borrowers. The rate is obviously very important, but there is more to mortgage planning than just the interest rate –
  • Am I allowed to break the mortgage if I need to consolidate debt?
  • What will it cost me?
  • How much extra can I pay down on my mortgage every month? every year?
  • What if I want to buy a second home or rental?
  • How can I make my mortgage interest tax deductible?
Interest rates at all time lows have many of us asking how we can take advantage of the potential savings. As the remainder of this newsletter highlights, quite often it can make sense to break the terms of your existing mortgage and take advantage of todays rates below 3%4. A bank would never help you get out of your higher-rate contract as it takes your money out their pockets. A Mortgage Broker however, recognizes that the mortgage process isn’t over once the paperwork is signed. Market conditions can, and do, change creating excellent opportunities for savings!
We all wish we had a little more time and little (or a lot!) more money. We know you work hard for your money and we will work just as hard throughout the life of your mortgage to make sure you’re keeping more of it in your pockets. Whether you would like to learn some tips and tricks to help you become mortgage-free faster, or you would simply like to access a better rate, contact me today to get started!
1 Savings calculations based off $350,000 starting mortgage balance, 25 year amortization with contract rates of
4% for a mortgage broker versus 4.175% contract for first term with bank and 4.4% contract rate for renewing terms. Savings is the interest savings over the life of the mortgage and monthly payment savings over the life of the mortgage.
2 Allen, Jason & Clark, Robert & Houde, Jean-Fraçois; Discounting in Mortgage Markets; February 2011; Bank of Canada
3 Davies, Kyle & Daniel, Rob; Canadian Mortgage Broker Channel: Consumer and Industry Perceptions; January 2011 Maritz Research
Variable (insured) 2.65% (Prime-.35%)
3 year fixed 2.70%
5 year fixed 2.89%
10 year fixed 3.79%

4 Interest rates quoted effective January 21st, 2013. Rates subject to change without notice.

Please let me know if you have any questions or feedback regarding anything outlined below. Thanks again for your continued support and referrals! Happy New Year!



With mortgage rates still hovering at historic lows, chances are you’ve considered breaking your current mortgage and renewing now before rates begin to rise.

Perhaps you want to free up cash for such things as renovations, travel or putting towards your children’s education? Or maybe you want to pay down debt or pay your mortgage off faster?

If you’ve thought about breaking your mortgage and taking advantage of these historically low rates, feel free to give me a call or send me an email to discuss your options.

In some cases, the penalty can be quite substantial if you aren’t very far into your mortgage term, but we can determine if breaking your mortgage now will benefit you long term.

People often assume the penalty for breaking a mortgage amounts to three months’ interest payments so, when they crunch the numbers, it doesn’t seem so bad. In most cases, however, the penalty is the greater of three months’ interest or the interest rate differential (IRD).


The IRD is the difference between the interest rate on your mortgage contract and today’s rate, which is the rate at which the lender can relend the money. And with rates so low these days, the IRD tends to be greater than three months’ interest. Because this is a way for banks to recuperate any losses, for some people, breaking and renegotiating at a lower rate without careful planning can mean they come out no further ahead.

Keep in mind, however, that penalties vary from lender to lender and there are different penalties for different types of mortgages. In addition, the size of your down payment and whether you opted for a “cash back” mortgage can influence penalties.

While breaking a mortgage and paying penalties based on the IRD can result in a break-even proposition in the short term, if you look at the big picture, you’ll see that the true savings are long term – as we know that rates will be higher in the years to come. Your current goal is to secure a long-term rate commitment before it’s too late, and here lies the significant future savings.

As always, if you have questions about breaking your mortgage to secure a lower rate, or general mortgage questions, I’m here to help!


Canada Mortgage and Housing Corporation (CMHC) recently introduced two new tools to help Canadian homebuyers make informed and responsible home-buying decisions – including a calculator and mobile app.

CMHC’s new Debt Service Calculator allows homebuyers to evaluate their financial situation and understand how much they can comfortably afford to spend on a mortgage. The easy-to-use calculator allows users to quickly estimate their gross debt-service ratio (GDS) and total debt-service ratio (TDS) – both important measures in assessing their financial readiness for homeownership. The Debt Service Calculator can be accessed by visiting: www.cmhc-schl.gc.ca/en/co/buho/buho_005.cfm.


CMHC’s new ‘Ready, Set, Home’ mobile app provides consumers, particularly first-time homebuyers, with comprehensive CMHC information and tools at your fingertips. The app helps homebuyers keep track of the details throughout the home-buying process and provides access to a variety of helpful calculators, articles and other resources.

Recognizing the increasingly fast-paced, electronic and mobile environment, the new ‘Ready, Set, Home’ mobile app is a free application that offers quick and convenient access to CMHC’s extensive housing information. The app can be downloaded to your Blackberry, Android or iPhone device at: www.cmhc.ca/mobile.

These new tools are the latest additions to CMHC’s comprehensive suite of free resources available to support Canadian homebuyers.

  • We are Canada’s largest and fastest-growing mortgage brokerage!
  • We have more than 2,200 Mortgage Professionals from more than 350 locations across the country!
  • Our Mortgage Professionals are Experts in their field and many are ranked among the best nationally.
  • We work for you, not the lenders, so your best interests will always be our number one priority.
  • We have more than 100 mortgage programs, making it easy to choose the best fit for your unique situation.
  • We close loans in all 10 provinces and 3 territories.
  • We can process your mortgage in as few as 7 days.
  • We are the preferred mortgage lender for several of Canada’s top companies.
  • Dominion Lending Centres’ Mortgage Professionals are available anytime, anywhere, evenings and weekends – and we’ll even come to you!